Netflix Appeal Deals DivX’s Streaming Patent a Staggering Blow

The Federal Circuit said an administrative tribunal wrongly rejected Netflix Inc.‘s challenge to a DivX LLC streaming patent based on a misinterpretation of a key term relating to data encryption—and that under the correct reading the patent would be invalid.

The appeals court said Friday that DivX argued for too narrow a reading of its US Patent No. 10,225,588. With a broader one the patent is obvious based on a combination of two earlier patent applications and a patent issued to DISH Network Corp., the panel ruled.

The disputed patent claim language, “so construed, is taught by ...